Dubai's Emaar could spin off retail business

Dubai real estate giant Emaar Properties may consider spinning off its retail business into a separate entity, chairman Mohamed Alabbar said in an interview with Bloomberg Television.

The company, which built the world’s tallest tower Burj Khalifa, currently counts Dubai Mall and Dubai Marina Mall among its retail assets. It has increasingly relied on revenue streams from its retail and hospitality units in the wake of the emirate’s property bubble bursting in 2009, which led to real estate prices slumping by up to 60 percent.

“These units are doing extremely well. We probably in the future will have to look at it again and see if we should entertain that and what that would bring in value to our shareholders,” Alabbar was quoted as saying. “I haven’t taken any decision yet.”

He added that he had previously considered spinning off the retail business, and that he expected recurring revenues derived from the leasing of malls and hotels to hit $1bn next year.

In the first nine months of this year Emaar posted a net profit of $493m, up 13 percent from the same period a year ago.

Revenue from January to September rose 36 percent to over $2bn, with 44 percent of this contributed by its retail and hospitality divisions.